Trade Idea: 21-6-2012 23:10
The Loonie took a hit yesterday, as a combination of poor domestic and foreign economic figures weighed on the Canadian dollar. Headline retail sales came in worse than expected, printing a 0.5% decline last month after rising by 0.4% in the previous month. Core sales also printed in the red, falling 0.3% last month.
Meanwhile, a Chinese manufacturing PMI report indicated that demand for commodities and raw materials could fall in following months. Of course, this didn’t bode well for commodity currencies like the Loonie.
Stopped out at 78.50: -63 pips/ – 0.75%
Despite the loss, I think this was still a solid setup. I just got blindsided by the news out of Japan. Tough luck, but it happens.
For now, time to shake off my recent losses and enjoy the weekend! Thanks for following me, I’ll catch y’all next week!
Trade Idea: 21-6-2012 02:44
Why is that?
Well, for starters, I think the risk rally that’s been fueling the CAD’s climb in recent days should die down, as it was mostly fueled by QE3 speculation. Now that the FOMC has held off on QE3 and announced a mere expansion of Operation Twist, I think it’s time for safe haven currencies to take back some of the pips they lost.
Also, I’m liking recent action on oil prices, which dropped sharply yesterday. Now remember, oil prices and the CAD often move hand in hand, so I think CAD may be in for some losses before the weekend.
With that said, here’s what I’ve done:
Since price is already at the top of the range, I didn’t hesitate to sell at market. My stop loss is a good distance above the previous high, while my profit target is set right at the range’s support.
I’m putting 0.75% of my account on the line with this trade, since I feel it’s something I may end up holding for a few days.